Investors Staged A Historic Move Out Of Stocks And Into Bonds This Week

This past week was a historic one for fund flows — investors pulled a historic amount out of equity funds while at the same time putting a historic amount into bond funds, and over 95% of the flows were in and out of ETFs.

Citi analysts Markus Rosgen and Yue Hin Pong relay the details in a note to clients:

U.S. funds had record-high inflow into bonds and outflow from equities — In the week ended 2/5/2014, there was a $14.8 billion inflow into bond funds and a $28.3 billion outflow from equity funds, representing record highs in both cases. The inflow into bonds was driven by U.S. bond funds which saw $13 billion of inflow. On the flip side, U.S. equity funds were hit by a $24 billion outflow. More than 95% of these flows were attributed to ETFs.

$6.4 billion of outflow from EM funds — This was the 15th week of outflows from EM equity funds and was the largest outflow since August-2010. The major outflow was from GEM funds, at $4.8 billion, while Asia funds had $966 million of outflow. EMEA funds and LatAm funds had respective outflows of $361 million and $199 million. China funds ended a 6-week run of inflows with $132 million of outflow this week.

$3.6 billion net selling of Asia equities by foreigners — In the week ended 2/5/2014, foreign net selling in Asia widened as Taiwan and Korea saw over $1 billion of net selling. Thailand was also sold down by $516 million. In Japan, during the week of 1/31/2014, there was a massive $7.0 billion net selling by foreigners.